Court Decides in Favor of DFA

Decision Underscores DFA’s Commitment to Protecting

October 6, 2009

Kansas City, Mo. - The Superior Court of the State of California for the County of Los Angeles has awarded Dairy Farmers of America, Inc. (DFA) $14.3 million in its breach of contract suit against Cacique, Inc., a California cheese manufacturer.

“We are pleased with the outcome,” said Alex Bachelor, DFA's vice president of legal affairs. “We have an obligation to our dairy farmer owners to protect their interests by ensuring that our customers, and others who have a business relationship with DFA, fulfill their contractual obligations to DFA.”

DFA sued, alleging breach of its milk supply contract with Cacique, when Cacique terminated the contract on 10 days notice in August 2007. The terms of the contract required six months prior notice to terminate. DFA incurred more than $13 million in damages as a result of Cacique’s failure to purchase milk from DFA during the remaining term of the contract. In addition to decreased milk sales revenues, DFA’s damages included increased marketing and transportation costs to secure alternative purchasers for the displaced milk on behalf of its members.